OptDev: A New Approach to Optimizing Development Investments and MDG Achievement

OptDev is a unique method and tool for conducting economic development planning. Unlike traditional development institutions that approach planning from an economic perspective first and foremost, this approach places culture, community goals, the environment, health, spirituality and other development goals first, while helping to determine what economic development strategies are appropriate to help achieve these goals. This helps to explicitly understand the outcomes of development in terms of the community’s goals, rather than just assuming that goals will be achieved through economic trickle-down. Originally developed for use in indigenous communities, OptDev helps communities, regions, etc. determine the best set of development activities and investments to help them achieve their goals and avoid undesired outcomes. This approach leverages the power of simulation and optimization to help communities envision the future that they desire and determine how to get there.
In order to collect data, prioritize investment alternatives, and select the best portfolio of projects and initiatives as part of an economic development master plan our software tool provides a unified framework for data collection, analysis and decision making. The engine makes use of cutting-edge metaheuristic optimization techniques to guide a search for the set of projects that will result in the best portfolio performance. The engine can be thought of as a portfolio optimization software system that selects the best “portfolio” of actions that simultaneously addresses economic, cultural and other development goals while minimizing risks. The innovations embedded in the system enable users to confidently design effective plans for achieving desired goals, employing accurate analysis based on real data. The tool also leverages data available from the World Bank Data Sets to help communities understand the appropriate development metrics to measure their efforts against and helps them set appropriate targets.
The process starts with goal-setting. The community determines its goals in both economic and non-economic terms. The process used to determine the goals can be set based on the dynamics of that community. For example, it can be a highly participatory process that involves a broad spectrum of the community. It can be driven by leaders or elders. Whatever is appropriate. Each goal has a number of components to it, such as how it will be measured, benchmarks drawn from World Bank databases, etc. The measures are particularly important and are key to driving the results. It is important to ensure that the goal reflect the true needs and desires of the community.
Communities can also articulate their constraints or outcomes that they desire to avoid. These can include not using certain resources, avoiding environmental damage, preserving certain sites, or any number of others. These are also key to driving the right results from the model.
Part of the process of calibrating the model is examining past economic development initiatives and understanding their impacts in the same terms that future goals will be measured against. This helps determine future outcomes. Again this is a place where data from the World Bank databases can help calibrate the model and determine future outcomes.
Once the model is calibrated and the goals and constraints are set, the tool simulates hundreds of potential future scenarios based on different combinations of projects and investments. Each simulation shows how well the goals are achieved and how the constraints are impacted. And each simulation gives a different set of parameters and determines how the future would be impacted. Using optimization methods, the tool then determines the optimum portfolio of investments and projects that maximize the achievement of goals and ensures that the constraints are not violated.
After the simulations are run, leaders can examine the outcomes of the scenarios. The tool provides a recommended portfolio based on the stated goals and constraints, but also provides transparency into other potential portfolios so that leaders can determine the tradeoffs that are most desirable to them.
OptDev gives community leaders the ability to envision potential futures and choose the portfolio of economic development investments that help them create the future they desire. More than just an economic tool, OptDev helps communities achieve the economic, social, cultural, health, spiritual and other outcomes that they desire.